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Research Paper | Economics | Madagascar | Volume 13 Issue 1, January 2024 | Popularity: 5.4 / 10

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Economic Challenges of the Informal Sectors: Case of Madagascar

Tsimangataka Andriamampiandra Tsimiovalaza

Abstract: The informal sector plays a crucial role in the development of Madagascar. It contributes to job creation, economic flexibility, income generation, poverty reduction and entrepreneurial dynamism. Informal activities respond to local needs, can withstand economic crises and promote innovation. However, it is important to address challenges such as the lack of social protection and precarious working conditions. To maximize the benefits of the informal sector, it is necessary to promote its gradual formalization by providing appropriate support. So we used the OLS method as a methodology which allows us to know the relationship of a variable in relation to other variables. In fact, the results show us that the informal sectors have significant relationships with unemployment and that of education. On the other hand, for GDP per capita, it has significantly weak and negative relationships with that of the informal sector. In the short term, the informal sectors improve the economic and social situation, but in the long term, this relationship is weak and presents itself in a negative way.

Keywords: informal sector, economic crisis, development, social protection, GDP per capita

Edition: Volume 13 Issue 1, January 2024

Pages: 167 - 172

DOI: https://www.doi.org/10.21275/ES231221120857

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